[quote=deadzone]
Again, show me examples of large companies selling off all their office space and property and I’ll believe they are going fully remote permanently.[/quote]
Um… Most companies don’t own their own offices anymore but….
“San Diego Office Vacancy Heads Up, Again
In the second quarter, office availability grew 30 basis points to 20.7%, the highest since 2011.”
BUT….If you read the article though. life sciences/biotech is one area where there’s huge demand.
And it probably makes sense. Life sciences/biotech usually requires an onsite lab facility. It’s not conducive to work at home…. .
“While tech and life science companies aren’t saving the market, they are driving the bulk of the leasing activity, thanks in large part to venture capital investment. In fact, demand for lab space increased 280% since March 2020 and office demand has already surpassed pre-COVID levels, according to research from JLL. This will likely support most office leasing activity and help to improve the metrics into 2022. According to JLL’s Tim Olson, senior managing director, the demand is driving both leasing and investment activity in the market.”
And we do know that here in San Diego, the investments in life sciences and biotech has been significantly expanding. $2.5 billion invested in San Diego.
“emand for new life sciences space is outpacing speculative construction among the top 12 U.S. life sciences hubs, including San Diego, according to a new report from CBRE.
Life sciences companies, rapidly expanding amid a race for new drug development, collectively sought nearly 23.8 million square feet of new laboratory space in those markets in the third quarter.
That exceeds the amount of lab space under spec construction – meaning space being built without a tenant already signed – by nearly 2.8 million square feet. The gap has widened steadily since last year – even as construction has ramped up considerably, growth in demand continues to outpace it.
The San Diego research and development lab vacancy rate currently sits at 2.2%, tighter than the Bay Area.”
So perhaps, simply put, none of us understands how the commercial real estate market works. Maybe not all commercial real estate is the same, and some buildings cannot simply be repurposed easily for the in-demand life sciences facilities….
It sure sounds like for SD, remote work friendly or not, that’s not entirely driving demand for housing locally. There might be a component to that. But it sure sounds in addition to that, there’s also a lot of companies setting up shop here in SD now… And maybe what we have is a perfect storm of both factors is why housing is in such short supply (that and builders not building enough)…
Speaking of heavy SD investment….it’s not just life sciences/biotech investments are pouring in….
“In rare twist, San Diego tech startups outmuscle life science firms for top money deals”
I mean, let’s think about this. When that new MM 3Roots community started taking waitlists for new home buyers, there were 14k+ people on a waitlist for 200 homes, and that’s before they stopped taking additional people on the wait list….
